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Estimates: Transparency and consultation for 'offshore projects'

Estimates & Committees
Penny Wright 27 May 2014

What provisions exist to ensure transparency and consultation on "offshore projects" under the NOPSEMA Environment Regulations? Penny Wright investigates during Budget Estimates.

Senator WRIGHT: My questions relate to the National Offshore Petroleum Safety and Environmental Management Authority, known as NOPSEMA. I understand the Offshore Petroleum and Greenhouse Gas Storage (Environment) Regulations 2009 require proponents of new large-scale petroleum development projects in Commonwealth waters to submit an offshore project proposal, an OPP, to NOPSEMA for assessment. I understand, and I read this on the NOPSEMA website, that the rationale for this is that an:

…OPP that has been assessed and accepted by NOPSEMA provides confidence to the proponent, stakeholders and the wider community that the project has been thoroughly assessed against clear criteria and found to be environmentally acceptable.
So that is the rationale for that. Offshore projects are defined on the website as:
…one or more activities that are undertaken for the purpose of the recovery of petroleum, other than on an appraisal basis…

I am interested in what 'appraisal' means. My understanding is that exploration activity is not defined as being an offshore project. Is that the case? So they do not require an OPP.

Ms Cameron: That is correct. It is for the development of offshore petroleum resources. An offshore petroleum proposal, an OPP, is for the full-scale development of resources once their future and potential has been assessed.

Senator WRIGHT: Can I clarify 'appraisal activities'? Another phrase for that which someone might use is 'exploration activities'. That may include things like seismic surveys.

Ms Cameron: Yes.

Senator WRIGHT: Exploratory drilling?

Ms Cameron: Yes.

Senator WRIGHT: Given that previously under the EPBC regime there was consultation available in relation to those preliminary appraisal activities—and given that the rationale on the NOPSEMA website is that, when the acceptance of an OPP has been made, there is confidence, there has been consultation and there is an understanding that there has been clear acceptance of environmental criteria—what then is the rationale for not having an OPP or a clear consultation process in relation to exploratory activities like seismic testing or exploratory drilling?

Dr Dripps: Obviously we are not the Department of Industry, which administers NOPSEMA. What we can do, though, is describe to you how the agency has been involved with NOPSEMA being authorised under the EPBC Act to undertake EPBC assessments, which does require a slightly different procedure than the standard procedure that is used in them assessing exploration activities. I will just pass back to Ms Cameron to run through how that worked.

Senator WRIGHT: I am happy to do that. I would like to have the emphasis on the concerns that have been raised with me by my constituents, which are that there are now deficiencies in transparency and consultation in these often significant exploratory activities like seismic surveys or like exploratory drilling so that, when proponents can then submit an environmental plan, there has not been an thorough consultation process preceding that environmental plan. Then I will come to the environmental deficiencies as well.

Ms Cameron: I was going to commence and talk about the enhancements and the conversations that, in doing the strategic assessment of the NOPSEMA regulations, we have worked with NOPSEMA to include with regard to public consultation.

Senator WRIGHT: Thank you.

Ms Cameron: With the environmental plans, they have undertaken to ensure that—

Senator WRIGHT: Can we come back to those? I have specific questions about the environmental plans. Let's just talk about the preliminary activities—like OPP does not include exploratory activities.

Ms Cameron: Because every activity that is undertaken in the offshore environment requires an environmental plan to be accepted before it can be undertaken, it is that process that actually provides the transparency for the community to be aware that these things are occurring. So, depending upon your comfort, if you wanted to move onto environmental plans, we could do so.

Senator WRIGHT: Alright then. I will do that. Thank you for that, because I have structured questions. Under the former EPBC process, a full referral was published by the department of the environment. Under the NOPSEMA process now—the so-called streamlined process—it seems that only the proponents' contact details, the decision's status and the associated date are published at the time an environmental plan is submitted. Is that right?

Ms Cameron: That is correct.

Senator WRIGHT: Alright. I just want to make sure my information is correct. Then a summary of the environmental plan is made public 10 days after the environmental plan has been accepted by NOPSEMA.

Ms Cameron: There is a step missing in that process. The consultation requirements for environmental plans are rigorous and require that the titleholder consult with persons whose functions, interests or activities may be affected by a proposed oil and gas activity. The regulations categorise these people as 'relevant persons', and persons can identify themselves to titleholders as relevant persons in advance. It is also possible to be aware that, within a particular area, a program of works may be occurring. So NOPSEMA will be looking for evidence that the titleholders, in submitting their EPs, have properly gone and sought the advice of relevant persons. That is one of the criteria by which an environmental plan may be accepted or not.

Senator WRIGHT: Yes. I guess my questions revolve around what the clarity or what those aspects mean. When stakeholders—for want of a better word—like my constituents, who have brought these issues to me, have actually inquired of NOPSEMA, they have been sent a copy of, essentially, the regulation, saying that the titleholder must give a relevant person sufficient information, whatever that means, and reasonable time to the relevant person. It also has not been clarified with them whether they indeed are relevant persons. My questions will come back to that. It is about the clarity of the whole process whereby people are feeling that they are operating in the dark somewhat.

The theory is that the proponent will have consulted with relevant persons, whatever that means—and I will come back to that—and will have given them sufficient information, whatever that means, and reasonable time to be able to be consulted. Then the proponent will put in an environmental plan, and 10 days after it has been accepted a summary of that environmental plan will then be available for the interested public. Not the whole environmental plan but a summary of that will be made public 10 days after the acceptance has already occurred. Tell me if I am wrong on this.

Ms Cameron: That is correct.

Senator WRIGHT: So, even after the approval, the environmental plan is not transparently available to all stakeholders. That is my understanding. The stakeholders are really concerned about that. They are relying on a summary. They are not even aware of what the environmental plan says.

Ms Cameron: The summaries are from 100 to 300 pages. They are substantive documents in themselves and include key information on oil pollution likelihood, the mechanisms for control and other aspects of that. NOPSEMA in its development of the strategic assessment also took on board to provide community consultation guidelines for industry and others. One of our main conversations with them in reviewing this matter was the role of community consultation as being an important part of giving the community confidence people in a streamlined regulatory environment.

Dr Dripps: I might add to Ms Cameron's response. The other consideration that might be relevant in thinking about the way NOPSEMA is doing this is how the arrangements worked under the assessment by our department of offshore petroleum and gas activities. The decision about whether to refer the activities to the Commonwealth was always the proponents' decision. It was not a requirement that every offshore oil and gas exploration activity be referred under the EPBC Act. Similarly, while the referral documents were available, there were sometimes—or perhaps even often—subsequent requests for technical information that did not end up being publicly disclosed. So, in working through the process with NOPSEMA as Ms Cameron has described, we have ensured that the same standards that were in place prior to this strategic assessment are now also in place, although they are administratively different.

Senator WRIGHT: I am interested in the rationale. Why not have the environmental plan, clearly of significance to relevant persons who are potentially going to be affected by the activities, just be transparently available for the public to see? Why a summary? Who is then deciding on what goes in the summary? Then there is always concern about what is being left out.

Ms Cameron: I understand. We have been informed by NOPSEMA about their surety about the nature of their assessments of environmental plans and the summaries that will be put out for public comment. Would it be possible for you to be involved when the Department of Industry is talking to whichever committee they talk to? You will be able to actually talk to NOPSEMA about this issue. They would have more details.

Senator WRIGHT: Later in estimates?

Ms Cameron: Later in the estimates fortnight.

Senator WRIGHT: I can certainly do that. I am going to be running up against the clock, but there are a few other issues that I want to cover quickly, and then I will put some questions on notice. I am interested in knowing the process—and, again, I can ask this later—for how NOPSEMA would determine if a stakeholder is raising relevant points of concern about what has been submitted in an environmental plan.

Senator Birmingham: Because time is tight: questions for NOPSEMA really do belong in the economics committee, where the Department of Industry presents. It is not for this department to explain how NOPSEMA does things.

Senator WRIGHT: Alright. Are you in a position to help interpret the environment regulations like what a 'relevant person' is?

Dr Dripps: Those regulations are the regulations that govern NOPSEMA and they are administered by the industry department, so those questions are best answered by them.

Senator WRIGHT: Thank you for that. I will follow that up with NOPSEMA then.

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